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Ecn121 MCQ Answers
Ecn121 MCQ Answers
a. Transfer payments
b. Value added
c. Final values of goods
d. Interest and dividends earned
2 Which of the following is not an objective of the Organisation of Petroleum Exporting Countries
(OPEC)?
a. Income Policy
b. Monetary Policy
c. Fiscal Policy
d. All of the above.
a. is the money value of the stock of all goods present in a country at a given period of
time.
b. is the money value of all final goods and services produced in a country during a year's
period of time.
c. is the money value of all transactions that occur in a country during a year's period of
time.
d. is the money value of all exports from a country during a year's period of time.
5 Which of the following can be used to check inflation caused by excess demand?
a. Increase in discount rates
b. Increase in government expenditure
c. Reduction in income taxes
d. Reduction in cash reserve ratio
a. Adam Smith
b. Alfred Marshall
c. Prof. J. M. Keynes
d. Prof. J. N. Keynes
a. autonomous consumption.
b. transitory disposable income.
c. saving.
d. disposal income.
10 Which of the following is an example of Monetary Policy?
12 A major reason for the establishment of the Economic Community of West African States
(ECOWAS) was to
13 Using the income method of computing the National Income of a country, which of the
following are excluded?
a. Transfer payments
b. Value added
c. Final values of goods
d. Interest and dividends earned
14 Money whose face value is greater than the actual value of the materials of which it is made is
referred to as
a. Fiat money
b. Token money
c. Legal tender
d. Quasi – money
15 The following are problems associated with National Income computation except:
16 According to Keynes, what is the most important determinant of households' spending on goods
and services?
19 The classical economists argued that the production of goods and services (supply) generates an
equal amount of total income and, in turn, total spending. This theory is called:
a. Keynes' General Theory.
b. The law of autonomous consumption.
c. The "animal spirits" theory.
d. Say's Law.
a. International Economics
b. None of the above.
c. Macroeconomics
d. Microeconomics
22 A progressive tax
23 Under the flexible exchange rate regime, an increase in the value of a country's currency in
relation to foreign currencies is called
a. Revaluation
b. Appreciation
c. Depreciation
d. Devaluation
24 Macroeconomics became popular after
a. 1972-73
b. 2006- 07
c. Great depression of 1929- 33
d. 1996- 97
25 The book "General Theory of Employment, Interest and Money" was published in
a. 1963
b. 1936
c. 1987
d. 1836
a. Ragner Frisc
b. Adam Smith
c. Alfred Marshall
d. Prof. J. M. Keynes
27 Those inflows of money to the government account against which no liability of repayment is
created, is called-
a. Capital expenditure.
b. Revenue receipts;
c. Revenue expenditure;
d. Capital receipts;
a. imported inflation
b. spiral inflation
c. demand-pull inflation
d. cost push inflation
a. IS curve
b. Accelerator;
c. Consumption;
d. Multiplier;
a. Monetary Policy
b. Fiscal Policy
c. All of the above.
d. Income Policy
33 An annual statement of the revenue and expenditure by the government is known as-
a. Revenue budget;
b. Consumer Budget
c. Budget;
d. Capital budget;
34 Which of the following controls money supply in the economy to promote economic growth and
development?
a. Central Bank
b. Finance companies
c. Development banks
d. Commercial banks
a. autonomous consumption.
b. Keynes' absolute disposable income hypothesis.
c. the marginal propensity to consume.
d. the consumption function.
a. Government expenditure
b. Investment expenditure
c. Personal savings
d. Export
44 Joseph lost his computer programming job when it was outsourced to a company abroad. After
looking unsuccessfully for several months for another job, he gave up and returned to school to
receive training to become a physical therapist. Currently Joseph is classified as
49 Which of the following measures the value of goods and services produced within a given
country for a given year?
a. GNP
b. Per Capita Income
c. GDP
d. NNP
51 The money value of all final goods and services produced in the domestic territory of a country
during a year plus Net factor income from abroad is called
a. GNP
b. GDP
c. GDP
d. GNP
52 Economics is best defined as the study of how
b. capital destruction
d. excess capacity
c. business law
a. adjustment problem
b. valuation problem
c. counting problem
d. communication problem
69 Which of the following describes the common usage of the term recession?
a. A fall in real GDP for two consecutive quarters
b. The slump in the supply of machinery
c. The low demand for goods and services for a quarter
d. The lack of industrial goods
70 Which of the following is the earliest economist to recommend the laissez-faire economy?
a. David Ricardo
b. John Maynard Keynes
c. Adam Smith
d. A.C Pigou
71 The branch of economic theory, and the doctrines, associated with Keynes is called
a. Keynes economics
b. Cambridge economics
c. Keynessian economics
d. Classical economics
72. Which of the following pairs best fit with fiscal policy?
a. Taxes and government spending.
b. Open market operations and reserve requirement
c. Taxes and open market operation
d. Open market operations and government spending
77. What does expansionary fiscal policy do to the production of cassava in Nigeria?
a. Does not affect it
b. Increases it
c. Decreases it
d. It depends
78. What does contractionary fiscal policy do to output?
a. Does not affect it
b. Increases it
c. Decreases it
d. It depends
79. What is the effect of expansionary fiscal policy on the money supply?
a. It depends
b. Does not affect it
c. Decreases it
d. Increases it
81. What is the effect of stable fiscal policies on the money supply?
a. It depends
b. Does not affect it
c. Decreases it
d. Increases it
83. Inflation:
a. Always reduces the cost of living
b. Always reduces the standard of living
c. Reduces the price of products
d. Reduces the purchasing power of money
85. An increase in aggregate demand is more likely to lead to demand-pull inflation if:
a) Aggregate supply is perfectly elastic
b) Aggregate supply is perfectly inelastic
c) Aggregate supply is unit elastic
d) Aggregate supply is relatively elastic
87. The effects of inflation on the price competitiveness of a country's products may be offset by:
a) An appreciation of the currency
b) A revaluation of the currency
c) A depreciation of the currency
d) Lower inflation abroad
88. According to the Phillips curve, unemployment will return to the natural rate when:
a) Nominal wages are equal to expected wages
b) Real wages are back at long-run equilibrium level
c) Nominal wages are growing faster than inflation
d) Inflation is higher than the growth of nominal wages
89. In the short run unemployment may fall below the natural rate of unemployment if:
a) Nominal wages have risen less than inflation
b) Nominal wages have risen at the same rate as inflation
c) Nominal wages have risen more than inflation
d) Nominal wages have risen less than unemployment
90. The Phillips curve shows the relationship between inflation and what?
a) The balance of trade
b) The rate of growth in an economy
c) The rate of price increases
d) Unemployment
91. The quantity theory of money allows monetarists to obtain a number of economic predictions
by assuming a constant
a)velocity of money
b)nominal output
c)overall price level
d)stock of money
97. One of these is not the causes of balance of payments (BOPs) deficits in Nigeria.
(a) Poor performance of the non-oil sector
(b) Import substitution strategies
(c) High servicing of debt
(d) Export promotion
98. The record of a country's imports and exports of goods and services is called its:
(a) Balance of trade.
(b) Terms of payments.
(c) Balance of payments on current account.
(d) Visible trade balance.
100. The record of a country's imports and exports of goods and services plus net investment incomes
and current transfers of money to and from abroad, is called its:
(a) Visible trade balance.
(b) Balance of payments on current account.
(c) Balance of trade
(d) Balance of payments.
101. The situation whereby a country imports more than her exports is:
(a) A trade deficit.
(b) A recession.
(c) An expansion.
(d) A trade surplus.